CARI Captures 202 (31 December 2014)

CARICAPTURES ASEAN

REGIONAL

CARI CAPTURES • ISSUE 202

The Asian Development Bank Institute, or ADBI, recently published

a report highlighting that efficient bank and financial institutions

were the underpinnings of successful integration amongst the

region’s capital markets.

The report emphasised the diverse size of each of the member state’s

various banking system, the lack of similarity in their provision of

domestic credit, and disparities in the quality of their equity and

bond markets

Whilst Malaysia and Indonesia compared favourably with their

01

31 DECEMBER 2014

Brunei Times (2 December 2014)

EffICIEnT BAnks A PRIoRITy foR AsEAn InTEgRATIon

international peers, states such as Bruney, Cambodia, the Lao

PDR, and Myanmar were listed as countries with a significant lack

of development in their financial infrastructure

Another key highlight of the report concerned itself with the ratio

of deposit accounts to population, which reflect the existence of

savings and liquidity within financial markets; based on 2010 data,

both Singapore and Malaysia led the region in deposit accounts

with 2134 and 1620 accounts per every 1000 adults respectively

ASEAN

Deposits

no. of accounts

per 1,000 adults

no. of accounts

per 1,000 adults

no. of bank branches

per 100,000 adults

no. of ATMs per

100,000 adults

Loans Outreach

108.0

504.7

44.3

1,619.9

na

487.8

2,134.3

1,119.9

na

7,169.0

2,022.0

2,021.9

317.0

163.0

Cambodia

Indonesia

Laos

Malaysia

Myanmar

Philippines

Singapore

Thailand

Vietnam

Japan

High-income Europe

US

South Asia

Sub Saharan Africa

28.9

274.8

4.0

284.1

na

na

967.7

237.0

na

171.0

701.0

na

38.0

28.0

4.0

8.3

2.6

10.5

na

7.7

10.3

11.2

3.3

34.0

32.0

35.7

7.0

3.0

5.1

13.4

4.3

56.2

na

14.9

58.6

77.7

17.6

133.0

94.0

173.8

4.0

5.0

Features of the Commercial Banking Sector

International Monetory Fund

CARI CAPTURES • ISSUE 202 31 DECEMBER 2014

DISCLAIMER: The news articles contained in this report are extracted and republished from various credible news sources. CIMB ASEAN Research Institute (CARI) does not make any guarantee, representation or warranty, express or implied, as to the adequacy, accuracy, completeness, reliability or fairness of any such information and opinion contained in this report. Should any information be doubtful, readers are advised to make their own independent evaluation of such information.

Market sentiment remained wary after Monday’s rout, as disappointing

corporate earnings, a weaker ringgit, lower commodity prices and

cooling factory orders in China and the eurozone kept investors

mostly on the sidelines.

Domestic consumption and investment growth are to slow due to

fiscal restraint, prudent monetary policy and a maturing credit cycle,”

said the bank’s Asian Economic Outlook 2015-2016.

Year-to-date, the US dollar has strengthened 4.59% against the ringgit

and investors are now worried that the country could face the spectre

of a twin deficit next year.

Expectation that lower crude oil prices will lower production cost hence

allow consumers to enjoy a higher income, is hampered by the fact that

finance Minister sommai Phasee initially planned to increase the

VAT by 1% in 2015 in order to increase the fiscal budget by 12-13%,

an announcement that was met with widespread concern amongst

businesses as Thailand attempts to recover from political strife.

Presently, consumer confidence within Thailand has experienced

moderate to weak recovery following the political deadlock that

plagued the nation’s economy; coupled with the additional household

debt incurred by families during the crisis, any additional taxes upon

the people can be viewed to be detrimental to the recovering econom

The Joint Standing Committee on Commerce, Industry and Banking

(JSCCIB) currently forecasts between 3.5% to 4% in economic growth

for 2015, a number that reflects delays in the disbursement of the Thai

government’s budget and slow pace of economic recovery

The move towards increasing the VAT has also been shadowed by the

10% reduction in corporate income tax, a fiscal policy decision that

many have stated will only benefit a few individuals whilst not actually

addressing fundamental fiscal issues within the nation

02

03

MAlAysIAn MARkET sEnTIMEnT AffECTED By ConfluEnCE of fACToRs

ThAIlAnD hAlTs VAT hIkE

The Star (3 December 2014)

Bangkok Post (3 December 2014)

THAILAND

AlMoST 20% of UAE fIlIPInoS MUll PRoPERTy BUy In ThE PhIlIPPInES In 201504

Almost 20 per cent of filipinos living in the UAE are planning to

buy a property in the Philippines within a year, according to a

new survey. The survey revealed that five out of 10 filipinos were

prioritising property investment and found cities such as Bonifacio

global City, Makati and Metro Manila attractive for investment.

Investing in Philippine property today is ideal for Filipino and international

investors as prices are likely to soar substantially in the coming years,”

said Karen Remo, managing director of New Perspective Media

Global financial institutions and analysts forecast good investment

returns in the Philippines, which is one of Asia’s most steady economies.

Majority of overseas Filipinos say they are looking at buying property

back home for their families, or as an investment, in the coming 12

months.

PHILIPPINES

MALAYSIA

Malaysia is an exporter of oil and gas. Subsequent to this event, it will

affect the aggregate demand and slightly trim the national revenue.

For next year, the research forecasts a 7% earnings-per-share growth

on a pick-up in corporate earnings, with a focus on growth stocks that

create shareholder value, over and above defensive and yield stocks;

hence assets are where investors could currently focus on.

Gulf Business (30 November 2014)

The property event comes about as Philippines is witnessing a stable

property market with high appreciation and rental yields coupled with

low interest rate and flexible financing terms. Backed by a strong

economy, a young and growing population and increasing income,

the Philippines is Southeast Asia’s strongest performing economy

and is among the fastest growing residential market.

They are also one of the world’s top 10 fastest growing luxury

property markets and has higher rental yields compared to other Asian

countries. The property sector’s growth is expected to remain robust.

Thailand Corporate and Sales Tax Rate

35

30

25

20

15

10

5

02004

Corporate Tax Rate8

7

6

5

4

3

2

1

020062005 20082007 2010 20112009 2012 2013 2014

Sales Tax Rate

Corporate TaxRate (%)

Sales TaxRate (%)

30 30 30 30 30 30 30 30

23

20 20

tradingeconomics.com



ASEAN MYANMAR

CAMBODIAAUSTRALIA

MALAYSIA

The Business Times (2 December 2014)

Bloomberg ( 1 December 2014)

The Nation (14 November 2014)

AsIAn hEAlThCARE gRouP BhD AnnounCEs IPo

MyAnMAR’s RolE In EAsIng TEnsIon DuRIng ThE AsEAn suMMIT

CAMBoDIAn PM DEfEnDs AusTRAlIAn REfugEE DEAl

05

06

07

The healthcare group seeks to execute a special Purpose Acquisition

Vehicle (sPAC) to tap into the rising demand for private healthcare

from Asia’s burgeoning middle class; the IPo is expected to raise

up to US$216 million.

According to documents filed with the Securities Commission, the

healthcare group hopes to use 95% of the funds raised with the IPO to

acquire at least one hospital providing secondary or tertiary care with

a capacity of 100 to 500 beds

International investors will have to wait at least 10 months for

Vietnam to ease curbs on foreign shareholders after a 2013 proposal

to increase ownership limits was shelved. Policy makers must revise

a Ministry of finance plan that recommended lifting the foreign cap

on voting shares in some industries to 60 percent from 49 percent,

Vu Bang, Chairman of the state securities Commission (ssC), said

in an interview on november 28. Bang, who had said in february

that the government was in the “last stage” of making a decision on

the proposal, now says a new version will be submitted in october.

Speculation that ownership limits for the US$56 billion stock market

would be raised helped boost the benchmark Vietnam Ho Chi Minh

Stock Index (VNINDEX) by 22 percent in 2013 and another 13 percent

this year. Money managers, including Templeton Asset Management

Prime Minister hun sen continues to affirm Cambodia’s deal with

Australia regarding the housing of refugees turned away from

Australian sanctuary; the $35 million resettlement program has

raised concerns over the social and economic costs incurred in the

sheltering of refugees.

In addition to those concerns, the US Based Human Rights Watch has

continued to call for the program to be suspended until Cambodia

improves its refugee support system; Prime Minister Hun Sen cited

the successful resettlement of 85 asylum seekers in an earlier 2009

program as proof that the country was willing and able to undertake

any and all refugees redirected from Australia

Currently, Yvonne Chia, head of the Group, holds the majority of equity

within the company, alongside other directors such as Chevy Beh, an

ex executive director for BP healthcare, and Jegathesan Vasagam, a

consultant for the diagnostics to laboratory medical group

Whilst the Asian Healthcare Group intends to focus on Malaysia in the

short term future, the firm has set its sights on ventures into Indonesia,

Thailand, and Singapore in the future; currently, the execution of the

SPAC will offer 80% of the company’s shares on the open market,

whilst the remainder will be held by Chia, Beh, and Negrita Holdings

and Dragon Capital Group Ltd. have said they’re unable to buy as many

shares as they want because of the caps

“This is disappointing as the market has been rallying because

investors were expecting the increase in the limit this year,” Attila

Vajda, Managing Director at Project Asia Research & Consulting Pte.,

said. It will probably take until 2016 at the earliest for a revised plan

to get final approval, Vajda said

The SSC will work with relevant ministries to revise the plan and

address inconsistencies with existing laws, Bang said. He said an

increase in foreign limits will be implemented “eventually” while

declining to provide details of the new proposal. The plan will need

approval from Vietnamese Prime Minister Nguyen Tan Dung.

Currently, the resettlement program involves Australia funding the

accommodation and resettlement services for refugees going to

Cambodia for a one year duration with the option to extend said funding;

furthermore, Australia has promised to provide health insurance for

resettled refugees for a total of five years

Refugees sent to Cambodia are however limited in a socioeconomic

sense as they are only issued “Prakas”, interim documents that do

not qualify for a refugee to open a bank account and other essential

purposes

Recent Special Purpose Acquisition Vehicles (SPAC) in Malaysia

Matrix Capacity Petroleum BhdDecember 2013

Rejected by Bursa Malaysia

Sona Petroleum BhdJuly 2013

CLIQ Energy BhdApril 2013

Hibiscus Petroleum BhdJuly 2011Raised



MyAnMARMonIToR08

PolITICs

National League for Democracy (NLD) chairwoman Aung San Suu Kyi blames government inaction for a recent fatal shooting at the Letpadaung copper mine in central Myanmar. One villager was killed and 20 others, including 11 policemen, were injured on 22 December in a confrontation at the mine when the police and Chinese workers erected a fence on land that the villagers claimed as theirs.

The Irrawaddy (29 December 2014)

Yangon held the first municipal elections since 1949 on 27 December, with voters hoping for change despite knowing little about the candidates or their policies. For many the ballot for the Yangon City Development Committee (YCDC) is the first chance to vote under the country's quasi-civilian government, which replaced outright military rule in 2011. But restrictions on who can vote mean that just 400,000 of the city's several million residents can cast ballots, while other clauses have strictly controlled who can stand for the YCDC. Voter turnout was only around 20%.

Bangkok Post (27 December 2014)

EConoMy

To ensure a sustainable eco-system, Myanmar has set an annual limit of 1.16 million tons of t imber for future demand despite annual increase in both local and foreign consumption. Logging in the 2013-14 fiscal year totalled 925,050 tons, while annual production for the current fiscal year of 2014- 15 is at 730,000 tons.

Xinhua (29 December 2014)

The Yangon-Mandalay highway will be upgraded to a world-class eight-lane road through the build-operate-transfer (BOT) system and tender will be opened for both local and foreign companies, according to the Ministry of Construction. The highway connecting Yangon, Mandalay and Naypyidaw has made headlines frequently for causing many fatal accidents.

Eleven Myanmar (29 December 2014)

Till third week of December, Myanmar's trade volume has become nearly US$20 billion – only five billion dollars short from the estimated trade volume of this fiscal year which ends 31 March, according to the Ministry of Commerce. During this period, average trade volume of a month was over US$2.2 billion and if this goes on, trade volume of this FY might exceed the estimated volume.

The Nation (29 December 2014)

Rice shipments across the Sino-Burmese border, considered illegal in China, accounted for more than two-thirds of total rice exports over the last nine months, according to the Myanmar Ministry of Commerce. Chit Khine, chairman of the Myanmar Rice Federation (MRF), said Myanmar’s rice exports across the Sino-Burmese border constituted the highest bilateral trade total, despite a Chinese ban on Myanmar rice imports. China banned rice imports from Myanmar earlier this year demanding a trade agreement guaranteeing that most rice is milled and meets quality standards.

The Irrawaddy (26 December 2014)

speaking to Malaysian reporters after hosting a luncheon in honour of visiting Thai Prime

Minister Gen Prayuth Chan-o-cha, Malaysian Prime Minister Datuk Seri najib Razak said Thailand

recognises Malaysia’s role in the southern Thailand peace process and has vowed to give a

firm commitment towards the effort.

Malaysia and Thailand would reinvigorate the peace process and restart the efforts based on the

three principles discussed; period of no violence and respect for the law, all parties be represented

in the peace process and they must agree to the list of demands or requests that they wished to

put forward to the Thai government

“Based on the three principles, Malaysia will continue the peace process and the Thai government

has stated categorically that Malaysia is the only country that they will work with in the peace

process,” Najib said

Besides, Najib pointed out that Malaysia and Thailand have agreed to strengthen cooperation in

addressing the problem of extremism, militancy and dual citizenship which are the long-standing

problems in both countries

The national Research foundation’s US$58 million project will map out the entire city

within a 3D model for knowledge sharing and community sharing.

The US$58 million will go towards the development of the platform, as well as research

into latest technologies and advanced tools over a period of five years, which will begin

operations in 2017

The 3D map will have uses within public, private, and research contexts; from potential map

applications, simulations of traffic and crowd behaviour, to other geo-spatial data applications,

the project hopes to improve the lives of Singaporeans in more than one way

A key concern to the collection of such data would be the breach of privacy rights relating

to land and buildings; the NRF has in turn guaranteed that safeguards will be put in place

to prevent the leaking of sensitive information which will be collected through the project

ThAIlAnD RECognIsEs MAlAysIA’s RolE In ThE PEACE PRoCEss

sIngAPoRE To sEE VIRTuAl MoDEl PRojECTBEGIn In 2017

09

10

Editorial Team : Sóley Ómarsdóttir , Cahaya Amalina, Yee Ken Li and Deena Elin Designer : Amira Aminuddin Consultant Editor : Tunku ‘Abidin Muhriz You can subcribe our weekly captures at: http://www.cariasean.org/newsletter-signup/

THAILAND

SINGAPORE

MALAYSIA

Borneo Bulletin (3 December 2014)

Channel News Asia (1 December 2014)

Singapore Land Authority Press Release

Potential Applications of Singapore’s Virtual Model Project

Community’s Travel FinderVirtual Singapore can be used to locate facilities or amenities in the neighbourhood.

Community SharingUsers of Virtual Singapore can work together to share information and resources for environmental sustainability.

Business and Community Monitoring/TrackingVirtual Singapore can translate information from tracking devices or wearables to help families, companies andpublic agencies project future needs.

Scenario PlanningAs a 3D City Model, Virtual Singapore can help to simulate possible scenarios of future amenities in their town andprovide feedback.

Services/ SolutionsLocate facilities or amenities such as bicycle racks, bus stops, coffee shops, clinics, study corners, etcAccess interior floor plans of shopping malls, community clubs and coffee shopsPlan routes for handicapped or during heavy rain

Services/SolutionsContribute and collate information on animal sightings and faulty facilities to alert fellow residentsShare information on energy generation and consumption and exchange tips to reduce energy usage and costShare information on when the recycling companies are coming, as well as their routes. Translate the informationinto an app for residents to inform the companies if there are old newspapers / clothes to be collectedShare information on the amount of recyclables consumed

Services/SolutionsTrack elderly family members who have dementia, or locate missing petsConduct neighbourhood watch using shared information to view the CCTV footage of public areas around theirneighbourhoodsPlot frequently used paths and spots to propose sheltered walkways, shelters, bicycle kiosks

Services/SolutionsChoosing paint colours of HDB blocks’ external surfacesLocation of new facilities such as basketball courts, parks, BBQ pits, function areas

CARI Captures 202 (31 December 2014)

Documents

Transcript of CARI Captures 202 (31 December 2014)